Scenarios to predict the future
By Perry Walker
I found this report very forward-thinking, with its reference to lifelong learning, alternative indicators to GDP (a speciality of the New Economics Foundation), basic income and so on. There was one exception to this, one part of the mental model which struck me as all the more outmoded because of the up-to-date-ness of its surroundings.
There are three ways in which we can treat the future. First we can predict; secondly we can say what is possible; finally we can say what we prefer. The Report says that "predicting the future... is becoming more difficult" (page 13) and gives examples, such as the banking crisis of the early 1990s, which arrived "like thieves in the night" (also on page 13). Yet it does not then abandon the prediction, as I would do, in favour of the possible to the preferred. Instead there is reference to "a new way of predicting the future" (page 16).
I would abandon prediction for reasons both practical and theoretical. Firstly, predictions rarely come true. The title of the seminar at Eagle Street was called "I have seen the future - but does it work?" This harks back to Lincoln Steffens, who visited Moscow in 1919 and said, "I have seen the future and it works". He was wrong.
In 1961, meteorologist Edward Lorenz was using an early computer to predict the weather. One day he tried to save time by starting halfway through the run, typing in the results at that point. He came back and hour later to find that the new run, which he expected to be the same as the old, instead diverged wildly. It turned out that he had typed in the results to three decimal places instead of six. This tiny change in initial conditions had vastly altered the prediction. This fact, now known as the Butterfly Effect, is why prediction is doomed in theory as well as practice.
Shell led the way in switching from prediction to the possible. Their scenarios - pictures of possible futures - have done them proud. They enabled Shell to be prepared when the oil price plummeted. Shell's managers had refused to believe that this was likely, but the scenarios got them playing with the idea on the basis that it was purely a possibility.
Shell's two current scenarios are 'Just Do It' - where individualism, agility and deregulation reign - and 'Dae Woo', based on a Chinese proverb that says "I sacrifice little me for the sake of big me". In Dae Woo, success depends on long-term relationships, commitment and investment. It seems to me that different parts of the Committee's Report fit into one or the other of those scenarios, but not both. The idea that cars are marked 'Made by Daimler-Benz' rather than 'Made in Germany' belongs very firmly in the first scenario. The references to a "capital of trust", by contrast, fit with the second scenario.
The background document circulated at the meeting drew on Peter Senge's book, 'The Fifth Discipline'. One of his disciplines is 'personal mastery', which includes clarifying and deepening our vision, and to establish our shared vision. So we need the third approach to the future - our preferences - to answer the crucial question raised but not answered in the Committee's Report: What is a good life?